"Türkiye is no longer a domestic demand-centered market; it has established itself as a strategic investment hub linking Europe, the Middle East and Africa. It is now growing rapidly as a base for production, technology, finance and logistics. With Korea's advanced industries, there is significant potential for cooperation in areas such as semiconductors, batteries and electric vehicles."
Furkan Karayaka, deputy president and chief financial officer of the Investment Office of Türkiye, said in an interview with ChosunBiz on the 13th that Türkiye can become a production and investment hub for Korean corporations. He noted that when Korea's technological prowess is combined with Türkiye's global supply chain and manufacturing base and its logistics network, complementary cooperation is possible.
Türkiye, leveraging its customs union with the European Union (EU) and free trade agreements (FTAs) with 30 countries including Korea, has the foundation to enter overseas markets with ease. Another strength is that 56 countries with about 1.3 billion people are clustered within a four-hour flight from Istanbul, the capital. About 900,000 university graduates enter the labor market every year, providing a deep pool of engineers and technical talent.
To attract foreign corporations in advanced fields such as electric vehicles, batteries, semiconductors and Fintech, the Turkish government is running the "HIT-30 program," a $30 billion (46 trillion won) initiative. It has also established a one-stop support system that covers everything from establishing a corporation and obtaining permits to applying for investment incentives, labor and residence permits, and site selection. Thanks to this investment environment, Türkiye has attracted $290 billion in investment from various countries, including Korea, since 2003. The following is a Q&A with Deputy President Karayaka.
─ How large has Türkiye's foreign direct investment (FDI) grown?
"Over the past 20 years, Türkiye's FDI has grown markedly. From 1973 to 2002, the total FDI inflow Türkiye attracted was about $15 billion. However, cumulative FDI inflows since 2003 to date have reached $290 billion. The composition of investment has also diversified. In the past, consumer goods dominated, but now we are attracting more investment in advanced manufacturing, digital infrastructure, logistics, renewable energy, mobility and Fintech."
─ What are the strengths of the Turkish market?
"The biggest advantage of the Turkish market is the depth and diversity of its economic structure. Türkiye has a broad production base ranging from agriculture to the automobile industry, the defense industry, Fintech, renewable energy and advanced manufacturing. It is the EU's largest producer of commercial vehicles and ranks 14th globally. At the same time, it is also the largest agricultural country in the EU.
There are also geographical advantages. There are 56 countries within a four-hour flight radius from Istanbul. The region's population is about 1.3 billion, with a gross domestic product (GDP) of $28 trillion and trade volume of $7 trillion. Market access to neighboring regions is also excellent. With the customs union with the EU, tariffs are exempted on intra-bloc exports, and FTAs have been signed with, or are in force with, 30 countries including the United Kingdom and Korea."
─ How much have the Fintech, gaming and e-commerce sectors grown?
"Türkiye has multiple unicorns (unlisted startups valued at $1 billion or more) in these sectors. They include mobile game companies Peak Games and Dream Games, marketing solutions company Insider, e-commerce platform Trendyol and ultrafast delivery startup Getir. The rise of these companies shows that Turkish corporations are securing competitiveness beyond the domestic market and onto the international stage.
In particular, the mobile gaming industry is advancing rapidly, helped by the advantage of being closely connected, in business and culture, with neighboring countries such as Germany, France, the United Kingdom and the Middle East. Many have moved their headquarters to the United States after succeeding in Türkiye. I understand that Korea's top five companies in gaming are also highly interested in the Turkish market."
─ What benefits does the government provide to foreign corporations?
"We have put in place various systems to support foreign investment. A prime example is the "HIT-30 program," introduced in Jul. 2024. This program provides subsidies and tax benefits, as well as financial and employment support, when corporations in advanced industries such as electric vehicles, batteries, semiconductors, renewable energy, mobility solutions and life sciences enter Türkiye. It is the most ambitious project in Türkiye's history, with about $30 billion being invested.
In addition, Türkiye treats international investors on par with nationals and protects property rights, while guaranteeing the repatriation of revenue earned from business. It also maintains an open FDI framework by allowing the use of international arbitration procedures, not only domestic courts, in the event of investment-related disputes."
─ What difficulties do foreign corporations face when entering Türkiye?
"Foreign investors face challenges in regulatory procedures, inter-agency coordination, market adaptation and execution. In particular, it can be difficult to understand administrative procedures and local business practices. A visit to the Istanbul Finance Center (IFC) can resolve these at once. The IFC is a financial hub established in Istanbul to attract international financial firms and investment institutions. There, investors can receive support throughout the entire investment process, from establishing corporations and obtaining permits to incentives, various approvals and site allocation."
─ What is the level of economic cooperation between Korea and Türkiye?
"Currently, more than 400 Korean corporations, including Hyundai Motor, Samsung Electronics, LG Electronics and POSCO, have entered Türkiye across various industries. As exchanges between the two countries have become more active, the trade structure has shifted from consumer goods-centered to manufacturing-linked. For example, thanks to a partnership with Celltrion, half of the materials and supplies for biopharmaceuticals (medicines made using living cells and proteins, etc.) produced in Türkiye are exported to Korea, which then processes them for export worldwide."
─ What fields would you like to collaborate on with Korean corporations going forward?
"We expect synergies between Korea and Türkiye in areas such as electric vehicles, batteries, semiconductors, clean energy and mobility technologies. Türkiye has talent and production capabilities in these fields. Each year, 900,000 university graduates enter the workforce, including 72,000 engineering majors and 23,000 software majors. This will be a favorable environment for the growth of Korean corporations.
There is also potential for cooperation in the defense industry. Like Korea, Türkiye is situated among multiple countries and has built up its defense capabilities. It ranks No. 1 in defense power among EU countries and No. 2 in NATO. It is advanced in many areas, including aerial drones, rockets and maritime. Recently, we have also been building ships in partnership with Korea. In addition, collaboration is expected with various technology startups and large corporations in fields such as Fintech, gaming and software as a service (SaaS)."